Bond Traders Face Gut-Check in Record $300 Billion U.S. Auctions
- Short-term Treasury yields had rare drop last week after Fed
- But largest 2-year sale since 2014 brings supply back in focus
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Bond bulls who enjoyed a rare rally in short-term Treasuries last week might not want to get too comfortable: The world’s biggest debt market is about to be inundated with an unprecedented wave of issuance.
The U.S. Treasury will probably auction about $294 billion of bills and notes this week, its largest slate of supply ever. The $30 billion two-year note sale is the biggest since 2014, and comes as the maturity posted just its fourth weekly gain in the last six months. The three- and six-month bill offerings remain at record sizes.